Buxly-Paints-Ltd.-Karachi

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					An Internship Report



       INDUSRTY INTRODUCTION AND ANALYSIS
Paint “A chemical oriented liquid used to protect & decorate different kind
of surfaces”
Paint industry in Pakistan can be classified into two major
segments
     Original sector
     Mushroom sector
    The main ambiguity is that how we can differentiate between these two
    sectors against which we can categorize our firm as in original sector or
    in mushroom sector.
    Some of these factors are given as
    1- Companies listed in stock exchange/registered firms or unregistered
       firms.
    2- Involved in planned promotion /no planned promotion.
    3- High price or low price, which is the major, factor in determining the
       position of a company.
    4- Under capacity tax /fixed tax.
    5- Having brands in more than one city or city base brands.

    On the basis of these factors we define the organized sector as the area of
    companies having their registration in the stock exchange having their
    planned type of promotion and other marketing activities.
    On the other hand if we see the mushroom sector there is no any
    organized and registered firms having no proper promotion and
    marketing activities. These are the price conscious companies having the
    aim to capture the low market by low pricing and under fix tax system.

    The major companies listed in stock exchange of Pakistan are
        ICI DULUX
        BERGER PAINTS PAKISTAN.
        BUXLY PAINTS PAKISTAN
The major competitors of BUXLY are the ICI & BERGER.
The question is why not others, the answer is that the both competitive
companies have the same variety and product range of paints as the
BUXLY.If we see the decorative paints the company have a wide range of
oil base, water base and epoxy base paints for the vary purpose.




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Though the companies have a same product line and brands as the other two
have but the major factor is that the revenue for both the companies are
greater than that of the Buxly.
In the end of the report we will find the weaknesses and threats which make
the profitable company on the edge of disaster.




      INTRODUCTION TO ORGANIZATION

K       HAN RAHIM BUX KHAN, the founder of                BUXLY PAINTS
        LIMITED first started his paint manufacturing activities back in 1933
in undivided India in the state of Hyderabad-Deccan which was perhaps the
first paint factory in that area at the time started by any local person. The
company was a proprietary concern and after partition of India in 1947, the
family migrated to Pakistan where in 1948 he set up the first paint factory in
Karachi under the name and style BUXLY Paints Works. Incidentally the
word BUXLY often leads people to believe that this is a British Company.
The word BUXLY actually comes from the middle name of the founder late
Rahim Bux Khan. The early years in the new state of Pakistan presented
many a hurdle like in other fields but nevertheless, the determination of the
founder of this company enabled him not only to survive the initial
difficulties but also to become, at that time the largest Pakistani Paint
Manufacturer in the country. Although he started his activities in Karachi
but soon he setup a factory in Chittagong and then setup his second paint
factory in Karachi in 1956. In the next few years, he was the largest


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manufacturer of Paints in Pakistan until the influx of the Multinationals. The
pride that BUXLY takes is not only that it is the first Pakistani paint
company and one of the oldest companies in the country but that it has
survived competition from the multinationals, imported paints and a variety
of other hurdles.
        The personal contribution of Late Rahim Bux Khan was the
development of specifications for paints in the early years. He was also the
founder chairman of Pakistan Paint Manufacturers‟ Association for many
years and as a philanthropist that he was, he constructed and donated a large
laboratory hall to the association for its research program, which is named
after him, Khan Rahim Bux Khan Paint Research Laboratory at Karachi.
        The company was the first to start the export of paints to the Far East
and to the Middle East naturally others followed suit. In 1963, a paint
factory was established in Beirut on a joint venture basis with a local
entrepreneur with Buxly Paints‟ know how and brand name which was the
order of the day. Buxly continued exporting its paints to several countries of
South East Asia and even to Africa. The year 1973 saw the establishment of
factory in Kuwait with BUXLY‟s know how.
        Although subsequent events lead to the loss of factories In Chittagong
due to Dhaka Fall and loss of factory in Beirut due to civil war there and loss
of Kuwait factory due to Iraqi invasion, nevertheless BUXLY in Pakistan is
still the largest Pakistani national paint manufacturing company and its
products still enjoy great respect in the decorative market as well as in the
sophisticated coatings such as Epoxies, Polyurethane, Chlorinated rubber
and a host of other paints too many to enumerate here. Buxly is recipient of
several international quality awards like Asian quality award and European
quality award.


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        In 1996, BUXLY started production of a new factory in UAE under
the name and style BUXLY SENSAIRE COMPANY LTD which recently
started operations. In May 1985, the status of the company was change from
private limited to public limited.
        The history of Buxly is full of extraordinary achievements and
paramount. It was the first paint company in Pakistan which has the credit of
pioneering paint technology, the first to begin a nucleus research facility
which has expanded with time and is now drawn upon by private and
government sector alike, The first to be awarded the international Awards
for quality in Spain & Singapore, the first to export the paint and paint
technology to bring in foreign exchange and the first company of Pakistan
which has been producing the aircraft paint of international standards.




Acquisitioned by


               BEGER PAINTS PAKISTAN LIMITED
                                     The drastic change occurred in the history
came in the last year when an age old company is going to be victimized by




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the factor of globalization and mismanagement of the factory and being
acquired by the Berger Paints Pakistan Limited .
The company did not mention the internal affairs of the acquisition and now
a days it is just fulfilling the legislation period after takeover of Berger.
Berger has made very drastic changes in the factory, which includes the
problems of union and down sizing by reducing the useless employees and
bringing the skilled, and knowledge able workers in the factory. Due to these
steps the factory is again on the way of excel and taking its place in the
competitive market due to its quality products




                       DIRECTORS & OTHERS


CHAIRMAN:                         Nasim Alam Khan
DIRECTORS:                        Mrs. Kaiser Sultana Khan
                                  Mrs. Amtul Rauf Khan
                                  Abdul Qadir H. Moochala
                                  Salim M. Khan
                                  Shahid Ghaffar
DIRECTOR (ADMN):                  Mushir Alam Khan


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EXECUTIVE DIRECTOR:    Yusuf Babar Khan
MANAGING DIRECTOR &
CHIEF EXECUTIVE:       Wassim Alam Khan

COMPANY SECRETARY:     Mohammed Khan
AUDITORS:              Ford, Rhodes, Robson, Morrow
                       Chartered Accountants.
LEGAL ADVISOR:         Abdus Samad
BANKERS:               The Muslim Commercial Bank Ltd.
                       Habib Bank Ltd.
                       United Bank Ltd.
                       National Bank Of Pakistan.
                       Bank Al-Habib Ltd.
                       Bolan Bank Ltd.
REGISTERED OFFICE:     E/20, S.I.T.E.
                       Polytechnic Road, Karachi-75700
FACTORIES:             X-3, S.I.T.E.,
                       Manghopir Road, Karachi-75700(Works 1)
                       E/20, S.I.T.E.
                       Polytechnic Road, Karachi-75700 (Works 2)




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        PHYSICAL SET UP OF ORGANIZATION

HEAD OFFICE:
        Buxly Paints Limited has a very well established head office which is
situated on Polytechnic Road of Sindh Industrial & Trading Estate, Karachi.
It is in the same building in which the production department exist. All the
activities and related paper work from purchase to production and then to
sales, billing and credits is done here.
FACTORIES:
        Buxly Paints Limited has three factories to produce quality paints. All
these factories are situated in S.I.T.E. area of Karachi. These factories are
titled as Works I, Works II (Unit-I        &   Unit-II). But due to the new
management which realize the problem of extra prime cost and conversion
cost due to enlarge production capacities and due to very low turnover, the
production is restricted only in works-I and production and offices are closed
And transferred in the W-I.
AREA OFFICES:
        Buxly paints limited has divided its paint market into two regions,
Southern region and Northern region. The sales and market of Southern
region is handled by General Sales Department which is in the Head Office
premises while the Northern region is controlled by two Sales Offices which
are situated in Rawalpindi and Lahore.




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Personnel Department


   n the world of today‟s industrial life, the importance of personnel
I  department cannot be denied. The function of any personnel department is
to manage the people who are at work. In BUXLY Paints Ltd. , personnel
department is newly established on January 1, 1997, previously there was an
establishment department which was practicing some preliminary practice of
personnel management. After realizing the needs of the organization, a
restructuring process took place on the behalf of Managing Director.
After the takeover of Berger the factory has no proper personnel working
department the person who is taking care of all the functions of personnel
department has both the responsibilities of personal and factory admin
manager and he is the wonderful person taking care of all the affairs of the
both spheres. He has only one coordinator the age old and devoted employee
Mr.Mehboob Ali who assist him in all the affairs of the factory policies
regarding the HR.
There is also workers union in the company which was established in
1958.the union produced many great problems of legislation and shut down
of the factory due to the acquisition of new management and factory has
faced a lot of crucial stages due to union and now after a year the union
problems are going to be settled by the entire effort of new admin manager
and legislation activities.




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Functions Of Personnel Department:
        The personnel department is engaged in exercising the following
types of jobs:


 Maintenance of the attendance and daily work joining & leaving records.
 Developing and updating the Bio-Data of all the employees.
 Issuing office orders especially for selection & recruitment, leaves,
    retirement, promotions, increments and allowances etc.
 Creating, keeping and updating the policy files according to the direction
    of top management.
 Guiding management to take decisions according to the policies
    especially in situations like increment, promotion & upgrading
    considerations, disciplinary violations and termination‟s.
 Assisting the management in the coarse of dealing and encountering with
    union affairs especially at the time of revision of biennial union-
    management contract.




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            Policy Issues In Relation To Human Resources


        Following are the major areas of human resources in which the
company has some specified policies and these issues are kept in the form of
files in personnel department. There is no order of papers in these files.
Being policy files, these should have only the final decisions on policy
matters but these are having a pile of papers including letters, irrelevant
office notices and a lot of other irrelevant material. Moreover the documents
in the files are not ordered chronologically. Mr.Mehboob Ali is now
responsible for the arrangement of the policy files and documents after the
downsizing of the employees without any designation and additional
benefits. The solution is that the department should be run in systematic
manner by having a complete and separate office setup and proper coding of
all these related things.
The policies as I notes are as follows:
Employees Classifications & Pay Scales:
        The employees in Buxly Paints Limited are broadly classified into
following categories.

                            Staff         Productive Workers     Non Productive
          Woks-I             25                   22                  10

        The above classification is a general kind of division showing the
overall strength of the employees however this categorization is further
classified into staff and workers in accordance with pay scales, this is shown
below :




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     Pay Scales              Senior Staff                     Junior Staff
      Grade I          2770-200-3770-250-5520        550-60-1150-80-1550-100-2050
      Grade II         3880-260-5700-300-7200          700-80-1500-100-2000-120-
                                                                 2600
      Grade III        5040-320-7280-370-9130         1000-100-2000-120-2720-140-
                                                                 3280
      Grade IV         7500-375-9375-410-12245-       1300-120-2500-131-3175-145-
                                 450-                            3875


The division of workers in various categories in accordance with their pay
scales is shown below:
                                  Class ‘B’                      Class ‘A’
       UN Skilled       400-40-800-50-1050-55-1325      450-50-950-55-1225-60-1525
      Semi Skilled        500-55-1055-60-1355-65-      550-60-1150-65-1475-70-1825
                                   1680
        Skilled         600-60-1250-70-160-75-1975     650-70-1350-75-1750-80-2135
     Leading Hand         700-80-1500-85-1925-90-                 *****
                                   2325


These pay standards of the staff & workers are revised periodically at the
direction of Directors.
Recruitment & Selection:
        There is no concrete policy for the selection & recruitment in Buxly
Paints Limited. Most of the new jobs are filled by the sons of old employees
working there which is the single criteria for most of the jobs. e.g. the son of
technical manager is assistant programmer in computer section. The son of
chief accountant is sales person and acting upon the policy of „looking busy,
doing nothing‟., the son of Ex-Senior general manager operations is chemist
in BUXLY PAINTS LIMITED. From all these, except the son of senior
general manager operations, any body is not doing up to the mark. Besides
this what is written in the policy file is that the directors are directly
involved in these matters with discretionary authority, however while



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recruiting a person in certain Department , the Head of that Department is
asked for the initial screening of the applicants and the final interview is
taken by the Executive Director or sometimes by the Managing Director.
        The newly recruited employees are asked to fill a Surety or Indemnity
Bond which is a kind of legal service agreement between the employer and
the employee. The probationary period of all categories of employees is of
three months but the Managing Director have the full authority to increase or
decrease (very rare) the duration of this period by judging the performance
of new employees.
Promotions:
        The criteria of promotion in the company is mainly based on the
seniority and a minimal kind of importance is being given to performance .
while promoting the employees from one pay scale to another it is strictly
cared that total strength of scale 2 should not exceed 40% of those in scale 1,
the total strength of scale 3 should not exceed 50% of incumbents of scale 2
and those in scale 4 should be a maximum of 40% of scale 3 while the total
strength of the employees in scale 1 is determined by considering the
changing of the organization.
Allowances:
        In Buxly Paints Limited, following types of allowances are being
given to employees:
House Rent Allowance: According to the lastly decided biannual contract
which will be valid up to 30-06-98, it is the policy that the staff members
who are drawing their basic wage upto RS. 1000 per month will be paid a
sum of RS. 840 per month as house rent allowance.




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The staff members whom basic wage exceed RS. 1000 per month will be
paid house rent allowance at the rate of 51% of their basic salary plus RS.
320 per month.


Conveyance Allowance: The policy about conveyance allowance as was
lastly decided in biannual contract mentioned above are as follows:
All workers are paid RS. 360 as conveyance allowance
All staff members drawing basic wage up to RS. 1000 per month are paid a
sum of RS. 410 as conveyance allowance
All Staff members drawing basic wage exceeding RS. 1000 are paid
conveyance allowance @ 17% of their basic wage plus RS. 234 per month
as conveyance allowance.
Attendance Allowance: As mentioned in the biannual contract, the
attendance allowance is given to the employees on the following basis:
 On full attendance during the month, RS. 125 per month per head
 On one day leave in a month, a sum of RS. 100 payable to each of such
    worker in that month.
 On two days leave a sum of RS. 80 per month payable to such
    worker/staff member.
 The workers/staff members availing leaves or being absent for more than
    two days in a month are not entitles to attendance allowance.
 This monthly attendance allowance is in addition to annual attendance
    award.
Recreation / Vacation Allowance:       Buxly Paints Limited also pays
special recreation & vacation allowance to its employees @ RS. 2250 per
annum on the occasion of annual vacations.



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Bonuses And Awards:
        Buxly Paints Limited announces and pays            bonuses to all the
employees in every financial year. The company also gives a “17-Year
Service watch” plus prize bonds on completion of 17 years of any employee
with the organization. Company also gives „hard work, loyalty and devotion
award‟ on any good performance to its employees so as to present a tribute
to hardworking, loyal and devoted employees. On the time of retirement, a
retirement award is given to the employees. Moreover, annual gifts of paints
are also being given to employees to increase their morale and motivation
level. But here is it is important to note that from last four years there was no
promotion and bounces for the employees due to the long years in the
factory economic conditions. During my stay at Buxly the new management
announces the increments and bounces for the employees.




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Leave Entitlements:
        In Buxly Paints Limited, an earned leave of 25 days per annum is
allowed to all the employees. In case of less absences the employees can
enact these leaves upto an accumulation of three years. For Medical and
casual leaves , employees are given a maximum period of 15 days with pay.
All the employees are given 15 minutes time relaxation so as to join the
office and even then if a person come late for five days his one annual leave
is deducted by the management.
Training Courses & Apprenticeship:
        Buxly Paints Limited rarely sends its employees to professional
institutes for training purposes but it is the policy of the management that
whenever an employee will be sent to any institute then all the expenses of
that training will be beard by the company and the person will be paid his
regular salary throughout the training period.
        The company also appoints different people as trainee employees
especially in the section of Research and Control Laboratories, which are
mostly the trainee chemists. The time period of this type of training is
usually one year. These appointments do not carry any pay scales but these
are paid agreed salaries. Any sort of allowances, bonuses, leaves
entitlements or gratuity and provident fund is not a matter of legitimacy to
these appointments.
Along with this Buxly also provide the internship to the local and country
wide business schools and institutes for their graduates for the learning of
the business activities and have a proper and planned schedule for that
purpose and provide them with all the facilities regarding their needs and
fully accommodate the internees by the stipend and lunch facilities.



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Graduity & Provident Fund:
        The policy prevailing in Buxly Paints Limited depicts that the
statutory graduity is not applied to those employees who have their
Provident Fund Accounts in the company. The rate of provident fund is
8.33% of the basic pay. At the end of service, retirement or death, it is paid
to employees with interest. Otherwise employees are paid graduity on the
basis of number of employment years, on number of years, the pay of some
days per year is given as graduity. Schedule of graduity is as follows:


                 1-5 years            25 days
                 5-10 years           27 days
                 10-12 years          30 days
                 12-15 years          32 days
                 15-20 years          40 days
                 20-25 years          45 days
                 25 and greater       50 days


Union-Management Affairs:
        All the workers and the junior staff in Buxly Paints Limited are
unionized. This union was established in 1958, since then it is working for
the rights and welfare of employees. The biennial Union-Management
contract is one of the efforts of union and of management also to satisfy the
workers and to smoothly run the organization.. This is the agreement which
takes place after every two years, in this contract the wage standard of
workers are revised, increase in allowances and bonuses are mutually agreed
upon. Due to the mismanagement and work shirking practice of the previous



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management the company suffer a lot of union problems and has to face the
crucial situation of shut down of production and legalities. But now by the
takeover of the new management the things are coming on their normal flow
and a successful down sizing takes place and company cover the losing
market by reducuing its factory overheads and prime cost and producing the
same sales with one –fourth of previous strength. In order to deal with the
union affairs management appointed the factory manager Mr.Niazi to solve
the matter with peace and mutual agreement and now the new union is
organized and all the legalities are being fulfilled.


Lunch Subsidy & Mess System:
        There is one canteen in Buxly Paints Limited, at Head Office. This
canteen is basically providing the lunch and tea facility to staff members.
The workers are not served with lunch but are paid the same amount as
lunch subsidy. The amount is as follows:


 For and on behalf of each staff member, a sum of RS. 10 per attended
    day plus a fixed amount of RS. 75 per head per month are paid to
    officer‟s mess
 All the workers are paid a sum of RS. 10 per attended day plus a fixed
    amount of RS. 75 per head per month as lunch subsidy.
 No deductions are made from RS. 75 fixed amount except on availing
    more than 25 days annual leave in a month.




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Social Security & Old Age Benefits:
        These are the institutions, which demand a fixed percentage of the pay
of all the employees from the employer so that the benefits should be given
at the time of retirement, death or any mishap during work. Under the policy
of social security Buxly Paints Limited deposits 7% of the wages of each
worker to Social Security Department and in case of any serious accident of
any of the employees all the medical expenses are beard by the Government.
The age of retirement in Buxly Paints Limited is 60 years and during their
service the company pays 5% of each employee wage to the government
under the system of Employees Old Age Benefit and 7% to the social
security so the these employees can get pension after their retirement.




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Shares Department



S     hares department was established in 1984, when the company was
      incorporated as public limited company and 5,00,000 shares of RS. 10
      par value were floated in the market. Before the restructuring of
establishment department, shares department was the part of it, but after the
restructuring now it has its own identity.
But the actual share department did not exist in Buxly now a days after the
acquisition of the Berger and the shares department is being under the Chief
Accountant and on my inquiry the cashier of the C.A give me the details of
the shares holding of the company after two days.
The department was in existence to perform the following functions


FUNCTIONS:


 Arrangement of Annual General Meeting
 Distribution of dividend amount to share holders whenever they are
    declared.
 Maintaining and updating the record of share holders.
 Issuing the share certificate to share holders and fulfilling the
    requirements of transfer deed in case of change in ownership of the
    shares.




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There are two staff members in this department and their hierarchy is shown
below.
                                                CHIEF ACCOUNTANT




                                               CASHIER
                                                  &
                                          ACCOUNT ASSISTANT




    The pattern of share holdings as at 31-05-2001 is shown as

Serial No         Categories of                   No of share   Shares held        Percentages
                  Shareholders                     holders
    1        Individuals                                   630 2233,353                   16.205
    2        Investment companies                             2   3,680                     .256
    3        Insurance companies                              1  10,000                     .694
    4        Joint stock companies                            4 356,900                   24.785
    5        Financial institutions                           1 355,709                   24.702
    6        Modarba                                          2   1,200                     .083
    7        Foreign investors                                1 460,250                   31.962
             (M/S Overseas group corporation)
     8       Co-operative societies                           1   11,400                    .792
     9       Charitable trusts
    10       Directors                                        7    7,508                    .521

 Totals                                                     649 1,440,000               100.000



From all of the above holdings the new management of Berger Paints
Pakistan Ltd.has acquired 262,320 shares and now running the company
successfully.




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 Finance Department



                                          CHIEF
                                       ACCOUNTANT




                        SENIOR                           CASHIER & SHARE
                     ACCOUNTANT                             HOLDINGS
                    (FROM BERGER)


                                         SENIOR
                                       ACCOUNTANT




     JUNIOR ACCUNTANT                ACCOUNTANT          JUNIOR              ACCOUNTNAT
        (FOR BILLING AND            (FOR DEBITORS)     ACCOUNTANT          (FOR CREDITORS)
           INVOICES)




        The most dominant and big department in BUXLY is accounts
department. The department is headed by a chief accountant and under him a
cashier is shown in the hierarchy that coordinate the overall activities of the
chief accountant and along with him the new management appointed its own
accountant to have a check and balance over the financial records and
business activities. The chief accountant is the person who is enjoying the
authority in the organization after MD. Most of the decisions that he makes
by his conservative approach to do the things are not in the benefit of the
organization. The department processes all the formal accounting practices



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in order to give information to the management, to the share holders and to
the government in the form of different financial statements etc. One thing,
which I noted in this department, is that work design in this department as is
in the whole organization is not clear. The proof for my opinion is the saying
of one key post holder in this department “ The work which anybody cannot
do, I have to do it.”
The person in this department are very much exhausted by the personality of
their ultimate boss who is the chief accountant, and it is not only their saying
but I do observe all the activities of that cool and rigid personality, at the
moment he is giving order for some document or statement on the same time
he is going to snub the person that why are you doing the work and leave
this work and do this new work. This factor basically demotivates the
employee in the department and they do not show loyalty for the
organization.
All the accounts department is computerized and all the process of general
voucher entry to the formation of reports are done with help of computers
and MIS department. The different persons having their designation of
senior accounts officer and junior officers are working on their terminal and
directly report to higher management and the chief accountant. The chief
accountant has no knowledge of computers and he always find shouting on
his sub ordinates and going on the policy “ do nothing and looks busy”.
Creditors:
Mr. Mohammed Anayat is an accounts officer responsible to handle the
record and transactions of creditors i.e. purchases. He records each and
every purchase .In it, he deals with all the purchase of raw materials,
containers etc. from local market and as well as from purchases. He also



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deals with the payments of the creditors and the promise dates to the
customers for receiving their cheques.
Most of the creditors are very much annoyed from Buxly by not paying
them on the promise date. This is destroying the credibility of the
organization in the market as well in the customers.
Debtors
. In the same manner, one accounts officer is to so the same nature of job but
for debtors. The person concerned is Mr. Azmatt. He deals with sales. The
documents under his concern are invoices, sales register, party ledger and a
monthly trial balance that he makes from these documents.
He is the very competent person and is appointed from the Berger side as a
senior accounts officer. He also deals with the banks loans and the personnel
Department and the payroll on the computerized software.
General Control
 Another accounts officer is for general control there is no any proper
officer who take care of the other financial affairs because due to computers
all the reports can be generated by the software, but there is a need of a
person who takes       care of   other activities including the general entry
vouchers and similar works because it will reduce the job burden from the
other workers and they will be able to perform their duties with full interest
and heartedly.
Cash Handling:
Mr. cashier in BUXLY PAINTS LIMITED. He is responsible to maintain a
specific amount of cash to give to the employees as their salaries, daily
allowance and for other petty expenses. He pays the amount after seeing the
passed voucher signed by a competent authority. He is a competent person



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but the company is not using its qualities and efforts and always be busy in
the cash affairs and banks instead of being in the office. After the acquisition
he is also taking care of the shares department along with his original job
and for this neither he nor any person doing extra from his job is paid for the
jobs they are doing in spite of their original work.

Junior Accountant

The junior accountants are for the purpose of making sales invoices and for
the production orders. They keep all the records and accounts details for the
finished goods used in the whole regions and making the sales invoices and
the challans for the production and sales orders.
The whole finance department is under the crisis because the people here
are just demotivated due to sudden acquisition of the Berger and drastic
downsizing has made the worker‟s loyalty against the organization and
secondly the behavior of their ultimate boss make them just to pass the time
only to the minimum level and not to put extra efforts in the organization.




                                          24                Buxly Paints Ltd.
An Internship Report




Cost & Tender Handling




 A        s an important and necessary part of a production concern, costing is
done prior to production in order to have a better idea about all type of costs
incurred on the manufacture of a good and to see how much profit we are to
get. In BUXLY PAINTS LIMITED Mr. Amin Sherwani is cost accountant
to do all this work. . He has his own ways and methods of costing which are
far away from all the theoretical and bookish concepts which we read before.
But the methods used by him are quite logical and he is having full expertise
in doing his work. His responsibilities are to cost a job for non-routine
nature. All the expected costs and their approximate figures are on his
fingertips. When a tender comes, he is the person to calculate the cost from
the formula given by technical staff. And on the basis of this costing,
BUXLY gives price for the specific contract. He is an expert person and
having an experience of many years now he can tell without doing
calculations an approximate cost which will incur on a specific formulas
because he knows the prices of raw materials and their variation and also
about all the other factors involved in it.
Costing Procedure:
        The costing procedure is mainly based on ratio of cost of raw material
to the total cost of product. Normally it Is assumed that the cost of raw
material is 60-63% of the price adding 10% excise duty it becomes 70-73%.
If 10% discount is given, it becomes 80%. It means that remaining 20% is
our conversion cost and margin. There is no tradition of braking up of
conversion cost in different sub heads and calculating amount of all these. A




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An Internship Report


simply monthly commutation of Labor and MOH is divided by all jobs to
calculate conversion cost per job.
         The prices of raw material are assumed to be 60-63% as is discussed
earlier in case of normal production but in case of contract or tender
business, in order to win the low cost competition it is assumed that cost of
raw material is 70-75% of the total price. It decreases our price of the goods
by decreasing margin because all the other ingredients of price are usually
fixed.
The alone person in the costing g also handle the cases of tender opening
and bids because there is no any other person capable of doing such type of
skill to handle with the parties and providing them the quality paints at low
price bids. So also performing the role of commercial manager who prepare
the tenders and give to the sales people for the tenders in the open markets. I
do work with him and learn a lot that hoe the raw material is purchased and
how the stock is take over and the monthly and year end reports of stocks are
prepared.
I was assigned a task by him to maintain the stock register of the raw
material by him and I try myself to complete it with whole heartedly.




                                         26                Buxly Paints Ltd.
An Internship Report




Production and Dispatch




A       ccording to the persons in BUXLY PAINTS LIMITED, paint can be
        defined as „ It is nothing but a complex chemistry packed in a tin”.
        Paint can be brushed it can be dipped in all to give protection and
beauty simultaneously. A paint manufacture of today has a vividly
challenging task to face; he has not only to make “paint acceptable for all
but has to be very sensitive to the environmental changes especially in the
fields of technology, creativity, economy and competition.
        Buxly Paints Limited, which has 64 years experience of paint
manufacturing and have passed through different eras of paint technology,
has now reduce its production from three factories to one production unit
due to its management crisis and new acquisition. The factories were named
as Works I, Works II (Unit-I & Unit-II)
WORKS-I: As it is previously mentioned that works-I is situated at S.I.T.E.
Karachi, in the past few years it was specified only to one type of production
but now it is producing all of kind of paints and all the offices are shifted to
the premises of this production area. Now it fulfill the need s of customized
products as well as the regular products of the factory.
Due to acquisition the factory operations are combined as single unit
producing the water base and oil base paints together.
        There is no general manager or a particular manager for handling the
operations of the factory because after the take over of Berger the executive
director is handling the all affairs of the operations along with its own



                                          27                Buxly Paints Ltd.
An Internship Report


responsibilities, he assist the two production mangers to do the work as per
the specifications. There are two production managers


    1- Production manager (Water Base)
    2- Production manager (Oil Base)


The both production managers look after the quality of the products as well
as the process handling by assisting the chemists         how to process the
chemicals on different stages. Both production managers are responsible for
all the production and are held answerable to executive director and
managing director.

QUALITY CONSIDERATION
The products of Buxly are of high quality and it is the first consideration of
the organization. Quality is the key to success for BUXLY, this thing is kept
in mind during all the production process. I have observed that it is tried that
the product, which is under manufacturing process, should be complete in all
aspects when it will reach in customer‟s hands. For this reason checking and
testing is done at all levels.
First raw material is tested. If it is OK, then it is put into the process and
during process all the things like viscosity, weight per litter, thickness,
glossiness, and other specifications are checked to match with old retained
samples. If any discrepancies are found, technically chemists and research
laboritries resolve these.




                                         28                 Buxly Paints Ltd.
An Internship Report



Documentation Procedures:
        The production process in Buxly Paints limited is initiates whenever
the production department receives an order from Sales Department or
Commercial Department. If the required raw material for the production of
specific paint is available in the factory store then a production start & the
production manager in which the name & specifications of products
manufactured, type & quantity of raw material used prepares job card sheet.
Dates of starting & completion, packing standards, weight per liter of paint
and loss percentage is described.
                                          If the raw material is not available
in the store then the production manager make an indent note and send to
Accounts department for the procurement of raw material. Here the problem
occurs because of the fact that the procurement of raw material takes time
and during that time all the labor sits idle and it results in wastage of time
and resources. As no formal forecasting of sales is done and the procurement
of raw material is based on personal judgment so these types of problems are
the matter of routine. The situation gets worst when the shortage of imported
raw material occurs. If raw material is present in bonded warehouse or bank
go down, the production manager fills in „raw material requisition‟ form and
sends it to accounts department, which arranges for the clearance of material
and then is issued to the production. In order to keep the record of incoming
raw material, a material movement Challan is prepared in which the entry of
raw material is made in terms of name of raw material, packing, and
quantity.
After the completion of paint production and its packaging a daily
packaging report is always prepared by the production managers. Production
department is semi-computerized and get the information and reports by

                                        29                 Buxly Paints Ltd.
An Internship Report


computer and also the store people prepare reports by their own. These
reports are:
         Monthly Raw material report
         Monthly finished Goods Report
         Semi Annually, Annually, Quarterly and monthly
            shade wise sales report
         Daily stock register maintenance.


        The production managers are not involved in any kind of planning
even related to production they are only responsible to produce paint as per
the direction of the higher management and the orders received from sales
department & commercial department.
Paint Manufacturing Process:
        According to Buxly people, in Pakistan there are only five companies
in Pakistan which are paint manufacturers and the others are just blenders.
They blend the ingredients together and make paint but do not know what is
happening inside it. Here it is not the aim to discuss the technicalities of
paint but to have a look on steps in the process of paint manufacturing. The
General manufacturing & operation process of paint can be divided into
following categories of functions.


                         Mixing
                         Stirring
                         Gumping
                         Thinning
                         Quality Assurance



                                        30                Buxly Paints Ltd.
An Internship Report


                          Packing
                          Dispatch & Delivery


Major Raw Material For Paint Manufacturing:
        For manufacturing quality paints, hundreds of raw material or
chemicals are available and can be substitute of other but there are certain
types of raw material, which are an essential part of a paint. In case of Buxly
Paints, certain varieties of paints‟ raw material are purchase from the local
market and other are imported. Broadly the raw materials can be divided in
five main categories.
                         1- Pigment
                         2- Additives
                         3- Thinner
                         4- Extender
                         5- Color Solutions


The raw material of paint factory has a wide range of above mentioned
products. There are about 190 items of raw material. Some important raw
material used in BUXLY PAINTS LIMITED is as follows
                        Titanium Dioxide
                        Yellow oxide
                        Chrome Pigment
                        Chalk
                        Soap Stone
                        Mica




                                          31               Buxly Paints Ltd.
An Internship Report




DISPATCH:
        Because the main aim and objective of any production concern is to
handover the product to the ultimate consumers and in this era of
normalization, this is done through proper distribution channels. For this
purpose, first and foremost thing is to dispatch the product to outside the
factory gate. In this regard some formal rules and regulations are to be
followed regarding the payment of sales tax and excise duty.




                                       32                Buxly Paints Ltd.
An Internship Report




Excise & Taxation Department

Excise officer is responsible for this. As there is single locations, so one
excise officer is appointed. Different type of forms, challans and registers
are used in this procedure, the process is somewhat as follows.




                 ORDER             CHALLAN               AR-1




                           GATE
                                                ACL
                           PASS




        Rate of excise duty is 10% . All the registers above are filled in
properly as requirements of the govt and after gate pass is prepared, loading
is done.
        So far payment of sales tax is concerned, it is movable tax and rate is
12. 5%. Company pays sales tax on raw material and after sales, it receives
from purchaser.
        In the current production Mr. Qamar-ud-Din is excise officer. He is an
able and experienced person and all the steps are on his fingertips. He is
really an asset of the company in his field and working according to the
policies of the organization.



                                         33                 Buxly Paints Ltd.
An Internship Report


        So far I noted in this department, it is the organizational policy to pay
full sales tax and excise duty even on the product which is given to the
employees or ,management on discount basis. There is no practice of tax
theft in BUXLY. There are totral three persons in the taxation department
and all are very competent in their work. There is no computer work in the
taxation department and all the activities are on manual basis.
There is a need of computer in the department for time consuming work of
long entries of reports.
The excise & taxation department prepare the following reports:
     Eb4
     Daily production report
     Daily clearance memo
     AR(application for removal)
     RG-1 (register for production clearance)
     RI-1 (it is the record in which the production of whole month is noted
        along with the removal and clearance).
     RI3-quarterly (raw material& container)
     Sales tax return reports.(for registered firms 15% & for unregistered
        firms 18%).




                                          34                 Buxly Paints Ltd.
An Internship Report




Laboratories, R&D and Quality Control.



A      s BUXLY believes on providing quality products to their customers,
       much more stress is on quality assurance. For this purpose two
laboratories are set in the current production plant. The Chemical Lab and
The Physical Lab. The staff of both the labs is more or less common. The
following staff is working for both the Labs.


                Mr. Sohail Akhtar      Tech. Manager
                Mr. Umer Itrat         Senior Chemist &Quality lab incharge
                Mr. Jamal-ud-Din       Senior Chemist
                Mr. Ahmad Ali          Trainee Chemist
        Mr. Umer Itrat Senior chemist and lab incharge is heading all the
technicalities in testing and R&D and two attendants are to assist the
laboratory staff. All the procedures of physical lab are more or less the same
as of actual production. Sample testing is done here. Usually the following
tests are done.


                 Weight per litter
                 Viscosity
                 Hefman reading


        Panels are used for color matching with kept samples. Samples of all
the shades and of the specific orders are kept so that the next production will
have the same shade as of previous.


                                         35                Buxly Paints Ltd.
An Internship Report


        Research and development lab is much more developed than physical
one. In it, the following tasks and instruments are the part and parcel of this
lab.
                 Testing Of Raw Material
                 Scratch test
                 Gloss test
                 Thickness test.
                 New innovations
                 Improvements


The following instruments are used for different type of testing.


Humidity Condensation cabinet.           It is a cabinet to test the state of a
painted surface in pessimistic humidity level and highest temperature i.e. 42
C. Panels to be tested are kept in this cabinet for at least 15 days and are
observed afterward. If panels are rusted, it means sample is not acceptable
and needs improvements otherwise it is OK.
Centrifuge machine.         This machine is used to separate different particles
from a suspension or paint. It is often used to test different paints for their
ingredients. Paint is pored into a test tube and the tube is placed in the
machine and then is rotated for the whole day. After this process, the
ingredients can be seen separately and are measured.
Electric Balance: As paint is defined as “nothing but a complex chemistry
inside a tin” so delicate measures are required to have high quality and for
this purpose electric balance is used. It can measure from .001 to 160 grams.
Impact: this is used to see the durability of paints against denting. A panel
is put inside the impact and is tightened. Due to the shape of the machine, a


                                          36                 Buxly Paints Ltd.
An Internship Report


mole appears on the panel and afterward it is observed either the paint on
mole is OK or not.
Scratch Resistance Test: As paint now a days is much more use for surface
coating than a decorative, so it is necessary to ensure that it will cover whole
the surface so that not a single microscopic scratch can be seen. It is an
electric test. As the panel is on a metal plate. It is tested for passing
electricity. As paint is a bad and metal is a good conductor of electricity. If a
scratch is there, circuit will be complete and the meter will show reading in
voltage.
Hardness and Adhesion test: in this test, it is checked that up to how
much extent a paint is hard. The machine consists of a knob which, during
operation revolves on panel both clock wise and anti clock wise. There is
provision to add weight on this knob. Then it is observed on how much
weight and after how much time what happens to the panel and is compared
to the standards.
PH test: It is to test the paint for its acidity or basisity
Pencil Hardness Test: It is to test up to what level painted surface can avoid
scratches etc.


        Labs in factory is just like the physical lab just mentioned above. All
type of routine tests are done here like weight per litter, viscosity and shade
matching etc. All the samples of routine products and of specific shades are
kept for future matching.
        As last words on this topic, Quality control is the most active and
aggressive department of the BUXLY. It is the hard work, knowledge,
experience and willingness to do something in all the staff of this department
which has made BUXLY a quality leader in paint manufacturing market and


                                            37                 Buxly Paints Ltd.
An Internship Report


same is the cause for recognition of BUXLY‟s paints by PIA ,Navy, NLC,
CAA ,commercial organizations and other armed forces and governmental
institutes.

The most important thing of the Buxly is that it has the fellow ship of United
Kingdome paint research association and has the ISO-9000 certification,
which show the factory consideration about the quality.




                                        38                 Buxly Paints Ltd.
An Internship Report




Management Information Sciences




The management information system (MIS) is the most important and the
best working department of the Buxly Paints, which is the more organized
and systematic department.
As being the person of the MIS I have a great interest in this department and
I work with all the persons of the department and learn a lot with all the
people. The department basically adjacent with the accounts department and
help the higher management in generating different reports and documents.
The configuration of the MIS department is given as:
There are three servers in the MIS department,
    1- Print server
    2- Branch System
    3- Factory System
There are six persons in the MIS department. All are very much experienced
and knowledgeable regarding their work. The four persons are from the
Berger side and other two are from the Buxly side. The detail of software
and hardware is shown as
Software
The software in the Buxly are very competent and properly made and are
provided by the Berger side. The whole database is made-up of latest version
of “Oracle” and along with this the office people take a lot of help from the
software‟s of office automation i.e. M/S Office, Exel etc.




                                        39                   Buxly Paints Ltd.
An Internship Report


The operating system of the machines is LINEX on the server and the
terminals are supported with other operating system as well and the software
is run by the help of TERMLITE (a software by which we can use linex base
software in Windows environment).
HARDWARE
The number of terminals and hardware are shown as
     Terminals (8)
     U.P.S (1)
     Printers (3)
     Storage Devices (cartridge tapes)
    The division of terminal is as follows
    1- PA of MD
    2- Senior Accounts Officer (receivables & personal)
    3- Raw material & inventory Officer(data base administrator)
    4- Accounts Officer (creditors)
    5- Senior Accounts Officer (general entry & voucher)
    6- Junior accounts Officer (receivables & sales invoices)
    7&8 are for the servers and are restricted to the data base administrator.
    The activities performed by MIS department are as follows
         Entry of journal voucher.
         Checking the balance of payment to creditors.
         Maintaining the accounts receivable
         Payroll & personnel information
         Preparing the sales invoices
         Raw material records
         Issuing of job cards



                                          40                 Buxly Paints Ltd.
An Internship Report


        For all these purposes and other termed reports Buxly has very
        competent data base administrator and working persons having the
        skill of doing thing in a computerized environment.
    The whole department of MIS work is very perfect and up to the mark.
    The performance of the MIS is comparatively better than other
    department but there are some flaws which effect the productivity of the
    department which are discussed in detail at the end of the report.
    The major problem with the MIS is that it is much influenced by the
    Chief Accountant, he just try to govern the department as per his own
    wishes and all the people are being disturbed by his activities. The main
    problem is that he didn‟t know any thing about the computers and just
    want to place orders. The MIS require a great concentration and peace of
    mind but the atmosphere is very tense and people are performing both the
    activities of accounts and the record of the data regarding the finance ,
    sales , invoices , raw material etc. the jobs of people are so much
    enlarged and enriched but the reward is very low as compared to the
    industry standards , so it just de motivate the people of the organization.




                                          41                  Buxly Paints Ltd.
An Internship Report




Raw Material & Store Department
The one of the major department of any manufacturing unit is its store
department and it evaluates the performance of the company in terms of
resource utilization and productivity. In Buxly the condition of the
department was very much worsened when I joined the organization.
The whole store show like the random placements of the chemicals and
colors and nothing is placed in order , in case of any requirement the
chemists and the supervisors were in search of the products without label
and proper place.
I was being assigned by the higher authorities of the Buxly to organize the
store of the raw material and finished goods. I have done a lot in managing g
the store of the factory.
The store has no person to be as in charge, the assistant of the production
managers was voluntarily doing the duty of store in charge. He has a
multiple duties to perform , at the same time he was issuing job cards and at
the other moment he found instructing the supervisors to the different
processes of the manufacturing.
I with my internee fellow first organize the whole department by placing the
labels on each item by identifying it with the help of the lab technicians and
tests. It is a very tedious job because there are about 180 items in the store
and all have different names and properties. The task we performed is
     Identify the items
     Labeling
     Weight of each item
     Proper place


                                        42                 Buxly Paints Ltd.
An Internship Report


     Division of store (According to type of materials)
    The ex-store in charge of the factory didn‟t fulfill his duties and the
    whole stock marinating of register          has irregular entries of the
    consumption and arrival of the raw materials. I has firstly completed the
    previous register and than regulate it on daily basis.
    Now the process is computerized and the MIS department maintains the
    consumption & arrival of raw material as well. The raw material officer
    issue job card for the production and than re-enter it after the production
    report is given , similarly the goods receive note (GRN) also entered by
    the same person as well as by the store in charge.
    The raw martial is purchased by the purchasing manager Mr. Naseem, he
    search out the market and purchase as per the feasibility and capacity of
    the factory.
    During my stay at Buxly, the factory hire a new person as store in charge
    and I give him proper training as per the requirement of the job.
    There are a lot of problems I have to face in the store because the store
    persons were very rigid to maintain it , in previous the factory was in
    great losses by this department and bearing high prime cost. Now after
    the computerization and new employee the losses are expected to be low.
    Because the management is exerting a high check & balance in case of
    raw material and their uses.




                                          43                 Buxly Paints Ltd.
An Internship Report




    Sales & Marketing
     Sales & Marketing
    The key department for any organization is its sales &marketing
    department and it serves as the ears and eyes of the organization. They
    perform the key role to the growth of company market share.
    I have spend a couple of weeks in general sales and marketing
    department. It is the first time that Buxly has acquired a Marketing
    person for the promotion of its product ranges.
    First of all I would like to state that there are three types of paints in
    which factory deals and they are given as
    1- Enamel
    2- Distemper
    3- Epoxy
    These three types of paints are classified into two major categories
             Decorative Paints
             Industrial Paints.
    The whole sales and marketing department is demotivated due to hectic
    and undefined work loads. The sales department has very poor facilities
    of transport and communication. They have to perform a lot of irrelevant
    jobs along with the sales. The repute of Buxly is going to be destroyed
    due to not fulfilling the      small orders. These customers are than
    transferring to other brands due to less effective production people. The
    sales people has to ran after the production managers and along with the
    taking of orders.




                                         44                 Buxly Paints Ltd.
An Internship Report


    The hierarchy is shown as




                                                GM
                                          Sales&Marketing




                                          Regional Sales Head
                                                (South)




                                         Senior Sales Officer




        Sales Officer               Sales Officer               Sales Officer            Sales Officer
              1                           2                           3                        4




                       Assistant Sales                                 Assistant Sales
                        coordinator                                     coordinator




                                                    45                     Buxly Paints Ltd.
An Internship Report


The all sales representative are given daily assignment as per the direction
by the general manager to the regional manager and than they decide their
daily visits to customers.
The performance of the sales employees is daily evaluated by the regional
sales manager and is being reported to the general manager. Senior sales
manger has divided the all four sales officers in to different areas of
consideration as industry, commercial, government bids and tenders,
decorative etc. the sales officers of Buxly are very kind to tell the process
and procedure and they guide me about the process of order taking to the
collection of the money.
Their procedure starts from the order copies , usually there are four copies of
order taking,
     One copy to the customer
     Second to the production
     Third to sales officer
     Billing copy
  The commercial order lead time is 2-3 weeks and for the industrial one
there are 4- weeks.
The sales force of Buxly goes through the market as per their specified
areas. Buxly has very small marketing and promotional activities to permote
its wide range of products. The orders are taken on the basis of personal
relations and on the behalf of very sound good will in the market of old
customers and specially in the field of government and defense departments.
Up till now the sales force has dual nature of job that is to sale and market
the product as well.
Burt by the hiring of an experienced marketing person the administration is
planning to go for the marketing activities.
The major loss which is going to be occur is the continuous reduction in the
commercial as well as the industrial customers due to very slow and less
effective production & promotion processes.


                                         46                Buxly Paints Ltd.
An Internship Report


Although       factory have still potential industrial as well as commercial
buyers, but the thing is that firm is loosing the customers not on the basis of
quality but mismanagement of the key resources of the organization and by
this they are loosing their valuable customers.

DISTRIBUTION SYSTEM OF BUXLY

Buxly has distributed the whole country in to three regions and each region
has its own regional manger and sales force.

The regions are
    1- South
    2- North
    3- Central
The regions send their report and have their own targets in a specific time
periods and also they monitor the activities of sales force and demand of the
customers for the paints.
The paint market for Buxly is very wide but due to lack and deficiencies it is
lagging behind to the other companies. The customer are satisfied by the
product it self but the problem exist in the organization itself. The main and
key factor in the sales is that our employee should be motivated and trained
for the work they are performing. But in case of Buxly except three
employees all are having very less knowledge of the paints and even
sometimes they blank in telling the price of the products.
The sales people have no technical or any task force which can give different
schemes of colors to the customers. Even there was very short number of
color cards for shade matching and to give some material to customers.




                                         47                  Buxly Paints Ltd.
An Internship Report




BUXLY’s PAINT MARKET


Market of paints has been a challenging job in one country because people
consider that paint is a decorative item, Even today it is considered as a
luxury and not valued as a protective element. The greater portion of our
population lives in villages, where people are illiterate and consequently
lacking the knowledge of paints. Even in cities people rely upon painters and
painters have their own technology and preferences. In spite of all these
draw backs in the market many companies in the field of paints striving,
with the help of their marketing activities, to gain high business. They have
realized that the market is growing with substantial potential as a
consequence of increasing literacy rate, standard of living, infrastructure
development, industrial growth and more and more emphasis on Defense
Strength.
        The above-mentioned phenomenon enforced Buxly to divide its
market of paint consumers into four categories.
                 GENERAL
                 INDUSTRIAL
                 CONSTRUCTION
                 Govt. & SEMI-Govt. CUSTOMERS.


General Consumers:
        This is the most important category of consumer because it constitute
the major portion of BUXLY‟s sales. This category use decorative items for
the use in decorating their houses, shops etc.
Construction Consumers:



                                         48               Buxly Paints Ltd.
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        These categories of consumers include contractors, Civil Engineers,
Associates, Construction Companies, Builders etc. These type of consumers
buy paint mainly for the decoration of Plazas, Apartments and flats which
are build for commercial or residential purposes. Price Considerations and
Discounts systems of more importance under this category. Under this type
of customers Buxly is selling to A. Karim & Sons, Hussain Constructors,
Rabia Project Construction, Imperial Constructors, Chapal Builders and may
other small contracts.
Competitors Of Buxly Paints Limited:
        Buxly Paints Limited is encountering these types of compassion that
very in their degree of intensity. These categories of competition are
described below.
                 Foreign Competitors
                 Inter-Industry Competition
                 Intra-Industry Competition


        Buxly Paint Limited is facing severe kind of competition with the
Multinational Giants like ICI, Berger and the every day emerging
mushrooms in the Industry. The 80% of volume of paints sold in the country
is from these mushrooms while the rest of 20% is sold by the so-called
organized sector that also includes Buxly. The multinationals with their
unlimited resources & diversified strategies making the survival of Buxly
more difficult. On the other hand the substantial increase of small
manufacturers of paints is also affecting the prosperity of the company
because of the following facts:




                                         49              Buxly Paints Ltd.
An Internship Report


        The mushrooms are doing business under the fixed tax structure but
their level of operating activities is very high as a result they have to bear
low cost of production and consequently their prices are very low.
Peculiar Brands Of Buxly:
        Following are the same of special most commonly & Renowned and
Purchased brands of Buxly.
                 413 Synthetic Enamel
                 Weather Fighter
                 Plastic Bound Distemper (PBD)
                 413 Silk Enamel (Mat Finish)
                 413 Acrylic Emulsion
                 Buxtone Plastic Emulsion

PERMOTION
As it is mentioned that there is no marketing and promotion activities which
can be mentioned in the report. But now the company has hired a new and
experienced person as a marketing manager. The GM marketing
Mr.A.R.Moosa has guide me properly and he is planning for the promotion
activities in the coming fiscal year.




                                         50                Buxly Paints Ltd.
An Internship Report




Financial Analysis
The financial analysis of the factory presents us the true picture of the
factory and its performance regarding the utilization of resources, worth and
its profitability.
We will first analyze the ratios of balance sheet and income statement items
of the factory financial records.
Ratio Analysis

The ratio analysis of the last two years of the factory financial resources ids
follows as

Name of ratio                                 1999               2000
Current ratio                      1.275382           1.064952
Quick ratio                        0.860441           0.692923
Average collection period          94.36674           79.2276
Account receivable turnover        3.814903           4.543871
Inventory turnover                 5.024244           4.820792
Fixed asset turnover               7.44675            5.990286
Total asset turnover               1.548095           1.454376
Debt ratio                         0.983371           1
Long term debt to capitalization   0.03537            0.035176
Debt to equity                     2.161311           3.068889
Time interest earned               -0.31392           -1.78428
Gross profit margin                0.017665           0.13595
Operating profit margin            -0.0112            -0.06808
Net profit margin                  -0.03052           -0.09576
ROI                                -0.04725           -0.13928
Return on equity                   -0.15191           -0.5667
Earning per common share           -3.94666           -9.39748

Short-term liquidity analysis is especially important to creditors, suppliers,
management, and other concerned with the ability of a firm to meet near
term demands for cash. The evaluation of Buxly Paints we observe that the
current and the quick ratios have shown a downward trend as we can see
from the ratios calculated on the page annexed. It seems that the financial
condition of the company is getting worse day by day. We observe that the


                                                 51        Buxly Paints Ltd.
An Internship Report


liquidity of the firm is also decreasing with the passage of time. When we
compare its performance with the previous year we observe that the short-
term liquidity has shown a considerable decline. But along with it we
observe the improvement in the collection period of the firm, which has
decreased from 95 days to 79 days, which is a considerable improvement
with respect to the collection procedures of the firm. So with this we observe
that the account receivable turnover is also improving which is a healthy
sign for the company. Well we observe that the inventory turnover has
decreased with the passage of time, which is also not good for the company.
If the situation is such and company is in production we see that the
company is piling its inventory. This has also a harmful effect on the current
ratios of the company too. As the current ratio will consist of a major portion
of the inventory which is also not a very good cash equivalent. As it requires
some time to convert into cash.
We observe that the debt ratios are also not showing a favorable picture as
we see that the debt to equity ratio has shown an increase in it. This increase
is also considerable. This shows that the risk of the organization is
increasing day by day. We need to know the reason of this increase in the
debt. We need to observe that is it that the firm is covering the fixed charges
efficiently. Long-term debt to capitalization ratio is not showing a marked
increase. The bad thing is that the times interest earned are going in
negative with the passage of time. So we see its really in hot water. What the
company is doing generating short-term debts with the help of its liquidity.
So we do not see a considerable change in the long-term ratio. Well a
negative value of the interest coverage ratio is showing a big question mark
to its future.

Although we see that the gross profit has increased with the passage of time
but the operating profit has decreased. Which shows that that company
expenses has increased. That gross profit margin is also not improved too
much. So what we observe in this case is that company is going through a
critical time. Well all the other profitability ratios, which I have calculated is
growing in the negative direction showing a poor performance of the
company. Well one more thing is that company has not paid dividend so
dividend ratios could not be calculated. The return on investment and equity
both are negative showing it not a good venture to invest in.
Well observing the financial conditions of the firm it seems that the only
source through which it could generate finances is short-term finances and
that too is a difficult job. Well the investor would not be interested in a
company who is showing negative returns and at the same time not paying


                                          52                  Buxly Paints Ltd.
An Internship Report


any dividends. The long-term borrowing also seems impossible. So the
suggestion for the company is to merger with another company or another
company could acquire this company.


Over view of company financial position

This 47 years old company of SITE, Karachi, has witnessed changes at the
highest level of its hierarchy and reduction of "quite sizeable staff". The idea
that lean organisation will improve profit ability has been popular
management                concept          in            the            country.
During the year under review, the company's sales at Rs 141.31 million
gross profit at Rs 19.21 million has registered decline by 24%, and 42%
respectively compared to the preceding year's. The company turned
operating loss at Rs 9.62 million (1998-99: Operating loss at Rs 2.08
million) and loss after taxation at Rs 13.53 million 1998-99: Less at Rs 5.68
million). The accumulated loss has wiped out its capital. But there is
negligible amount of long term debt and current ratio reflects easy liquidity
position. The share place has gone below par after remaining much above
par value during the last half of last year. The directors lamented, "The
company has tried its utmost to persuade the government to finish off double
taxation but has failed so far.
There has been across the board changes at the highest echelon of the
hierarchy of Buxly Paints Limited. Wasim Alam Khan resigned from the
post of the Chief Executive and in his place Yousuf Babar Khan was
appointed as new Chief Executive. Nasim Alam Khan Chairman and
founder director resigned and Wasim Alam Khan was appointed as
Chairman. Sheikh Ejaz Majid was appointed director in place of Nasim
Alam Khan. Abdul Qadir H. Moochhala, resigned and Muhammad Saeed
was                    appointed                  as                    director.
The company is the manufacturer and marketer of paints, pigments,
protective surface coatings varnishes and other related products.
Buxly Paints Limited was incorporated 47 years ago in the province of
Sindh. Its manufacturing facilities were set up at the prime location of the
oldest industrial zone of the country at SITE, Karachi. Therefore the
factories of the company are located on the prime and valuable real estate.
Its fixed assets were re-valued twice once in 1976 and the other time in 1989
by professional and reputable values. The amount of Rs 24.34 million has
been booked in the account of Surplus on Revaluation of Fixed Assets.
The shares in the company are quoted on all stock exchanges of the country.


                                          53                 Buxly Paints Ltd.
An Internship Report


At present, its 10-rupee share is quoted at Rs 8.25 at 17.5% discount to its
par value.
The price has dipped below par value with the arrival of the new millennium
as during the last half of the preceding year 2000, the price band had
remained between the high/low of Rs 13 and Rs 11 per share. The stock
quotation appears to be barometer of the financial position of its balance
sheet.
During the year under review the company has turned higher loss at Rs
13.53 million compared to the preceding year's. Compared to the paid up
capital of Rs 14.40 million its accumulated losses swelled to Rs 14.86
million leaving an impaired equity base of in negative figure of Rs 0.46
million.
The total asset base suffered contraction to Rs 97.16 million from previous
year's          figure        of         Rs         118.27           million.
OVERVIEW (January , 2000)

 This 47 years old company of SITE, Karachi, has witnessed changes at the
highest level of its hierarchy and reduction of "quite sizeable staff". The idea
that lean organization will improve profit ability has been popular
management                concept          in            the            country.
During the year under review, the company's sales at Rs 141.31 million
gross profit at Rs 19.21 million has registered decline by 24%, and 42%
respectively compared to the preceding year's. The company turned
operating loss at Rs 9.62 million (1998-99: Operating loss at Rs 2.08
million) and loss after taxation at Rs 13.53 million 1998-99: Less at Rs 5.68
million). The accumulated loss has wiped out its capital. But there is
negligible amount of long term debt and current ratio reflects easy liquidity
position. The share place has gone below par after remaining much above
par value during the last half of last year. The directors lamented, "The
company has tried its utmost to persuade the government to finish off double
taxation but has failed so far."
There has been across the board changes at the highest echelon of the
hierarchy of Buxly Paints Limited. Wasim Alam Khan resigned from the
post of the Chief Executive and in his place Yousuf Babar Khan was
appointed as new Chief Executive. Nasim Alam Khan Chairman and
founder director resigned and Wasim Alam Khan was appointed as
Chairman. Sheikh Ejaz Majid was appointed director in place of Nasim
Alam Khan. Abdul Qadir H. Moochhala, resigned and Muhammad Saeed
was                    appointed                  as                    director.
The company is the manufacturer and marketer of paints, pigments,


                                          54                 Buxly Paints Ltd.
An Internship Report


protective surface coatings varnishes and other related products.
Buxly Paints Limited was incorporated 47 years ago in the province of
Sindh. Its manufacturing facilities were set up at the prime location of the
oldest industrial zone of the country at SITE, Karachi. Therefore the
factories of the company are located on the prime and valuable real estate.
Its fixed assets were re-valued twice once in 1976 and the other time in 1989
by professional and reputable valuers. The amount of Rs 24.34 million has
been booked in the account of Surplus on Revaluation of Fixed Assets.
The shares in the company is quoted on all stock exchanges of the country.
At present, its 10-rupee share is quoted at Rs 8.25 at 17.5% discount to its
par                                                                     value.
The price has dipped below par value with the arrival of the new millennium
as during the last half of the preceding year 2000, the price band had
remained between the high/low of Rs 13 and Rs 11 per share. The stock
quotation appears to be barometer of the financial position of its balance
sheet.
During the year under review the company has turned higher loss at Rs
13.53 million compared to the preceding year's. Compared to the paid up
capital of Rs 14.40 million its accumulated losses swelled to Rs 14.86
million leaving an impaired equity base of in negative figure of Rs 0.46
million.
The total asset base suffered contraction to Rs 97.16 million from previous
year's          figure         of         Rs         118.27           million.
But there are redeeming factors also as there are negligible figures in the
account of long term debts in both the years under comparison.
Moreover the current ratios in the years under comparison were at
1.47%/1.25 which are much above the benchmark ratio of "one".
Production declined by 24% to Rs 1.449 million litres from the previous
year's        figure       of       Rs       1.909        million       litres.
The accelerated slide in the profitability requires planned recovery
strategies. Some glimpses of remedial measures are apparent in the
Directors' Report, such as efforts to reduce expenses including separation of
"quite sizeable staff".
              ===================================================
              Performance Statistics           (in Million Rupees)
                June 30                            2000      1999
              ===================================================
                              Capital & Liabilities
                Share Capital Paid-up:            14.40     14.40
                Accumulated (Loss):              (14.86)   (2.05)
                Shareholders Equity:              (0.46)    12.35
                Surplus on Revaluation of F/A:    24.34     25.06
                L.T. Debts:                        0.46      0.86



                                         55                Buxly Paints Ltd.
An Internship Report


                Deferred Liabilities:               4.21       5.94
                L.T. Deposits:                      0.53       0.53
                Current Liabilities:               68.08      73.53
                Tangible Fixed Assets:             23.59      25.00
                L.T. Deposits:                      1.07       1.49
                Current Assets:                    72.50      91.78
                Total Assets:                      97.16     118.27
                           Sales, Profit & Payout
                Sales:                           141.31      186.19
                Gross Profit:                     19.21        32.89
                Operating (Loss):                 (9.62)     (2.08)
                Other Income:                      2.69         0.54
                Claim for Refund for Excise Duty: -             3.43
                Depreciation:                      1.71         1.87
                Financial Charges:                 5.39         6.64
               (Loss) Before Taxation:          (12.32)       (4.75)
               (Loss) After Taxation:           (13.53)       (5.68)
               (Loss) Per Share (Rs):           (9.40)        (3.95)
                                Share Price (Rs)
                 Dated 19-01-2001:                8.25            -
                               Financial Ratios
                  Price/Earning Ratio:                (-)          -
                Book Value Per Share:             (0.31)        8.56
                  Price/Book Value Ratio:           (-)            -
                Debt/Equity Ratio:                2:98          2:98
                Current Ratio:                    1.47          1.25
                Asset Turn Over Ratio:            1.45          1.57
                 Days Receivables:                 80             92
                 Days Inventory:                   76             73
                 Gross Profit Margin (%):          13.59      17.77
                Operating Margin (%):             (6.80)     (1.12)
                Net Profit Margin (%):            (9.57)     (3.05)
Plant Capacity & Production
(000' liters)
            A)         Actual Production:        1,449.75   1,909.04

    B) Capacity: The capacity of the company's plant
       is indeterminable as it is a multi-product
       Plant involving varying processes of manufac-
       turing."




OVERVIEW (August 31, 2000)
 Fourteen years ago this paint manufacturing company was listed at Karachi
Stock Exchange. At present the scrip in Buxly Paints is trading at Rs 6.90 at
substantial    discount     to    its    par    value       of     Rs     10.
The 7-year highest price of the share was quoted in 1994 at Rs 35. So the
present market value reflects 80.3% diminution in market value.
The company has relatively good track record of regular dividend payout as
between 1994 and 1997 the company paid dividend in 3 years out of 4 years.


                                            56                Buxly Paints Ltd.
An Internship Report


Since last year the company has suffered losses. So the expectations about
dividend payout may not be materialised. During six months ended
December 31, 1999 Buxly Paints recorded after tax loss at Rs 4.73 million
and this is 19.7% less than the loss at Rs 5.89 million booked in the
corresponding                   period                last                year.
The reduction in loss is significant in the background of lower sales as well
as gross profit. Sales at Rs 81 million declined by 11% to Rs 80.7 million as
compared to sales at Rs 90.6 million booked in the previous first half year
(FHY). Gross profit also declined to Rs 12.84 million by 19.2% from
previous corresponding period's Rs 15.90 million. The main reason for
reduction in net loss is the decline in selling as well as administrative
expenses.
Stock in trade also declined by 36.6% to Rs 27.68 million as compared to
previous     FHY's        closing     stock    of    Rs     43.65      million.
But trade debts remained around Rs 43 million in both the periods under
comparison.
The company has been facing tough competition from small mushroom
registered (paint) factories as their substandard produce is priced at Rs 300-
Rs 400 for kanastar less than the company's product.
              ===================================================
              Performance Statistics           (in Million Rupees)
              Half Year to December 31               1999      1998
              ===================================================
                              Capital & Liabilities
                Share Capital - Paid-up:          14.40     14.40
                Accumulated (Loss):               (6.77)   (2.26)
                Shareholders Equity:               7.63     12.14
                Surplus on Revaluation of F/A:    25.06     25.06
                L. T. Debts:                       0.68      1.17
                L. T. Deposits:                    0.78      0.53
                Deferred Liabilities:              6.11      5.80
                Current Liabilities:              71.95     73.34
                Tangible Fixed Assets:            24.72     24.89
                Other L. T. Assets:                1.91      1.44
                Current Assets:                   85.58     91.71
                Total Assets:                    112.21    118.04
                Sales:                            80.66     90.61
                Gross Profit:                     12.84     15.90
                Operating (Loss):                 (1.10)   (2.91)
                Other Income:                      0.14      0.52
                Financial Charges:                 3.36      3.50
                (Loss) Before Taxation:           (4.32)   (5.89)
                (Loss) After Taxation:            (4.73)   (5.89)
                                   Share Price
                 Dated 22/8/2000 (Rs):            6.90          -
                Book Value of Share (Rs):          5.30      8.43
                Price/Book Value Ratio:            1.30           -
                Debt/Equity Ratio:                 2:98      3:97
                Current Ratio:                     1.19      1.25



                                          57               Buxly Paints Ltd.
An Internship Report


                Gross Profit Margin (%):       15.91   17.54
                Net Profit Margin (%):          5.86    6.51
                Earning Loss Per Share (Rs):    3.28    4.10




                                         58            Buxly Paints Ltd.
An Internship Report



Balance Sheet comparison of last two years

                                                             2000            1999
Assets
  Tangible fixed assets
  Operating assets at cost less
                Accumulated deprication                  23589729        24423587
Capital work in progress                                                   579049
                                                         23589729        25002636


Long term deposits                                        1070625         1486894

Current assets
     Stock in trade                                      25327419       30510918
     Trade debtors                                       31098866       48805529
     Advance deposits prepayments                        13240494       11686444
      Cash and bank balance                               2834293        2776933
                                                         72501072       93779824
Total assets                                             97161446      120269354




Equity and liability

Share capital and reserves
Authorized                                               50000000        50000000
          5000000 ordinary shares of Rs 10 each
Issued subscribed and paid up                             14400000       14400000
Revenue reserve                                          -14859908       -2048775
                                                           -459908       12351225

surplus on revaluation of fixed assets                   24339024        25060268
Long term deposits                                         525000          528000
Deferred liabilities
      Staff gratuity                                      3913203         5643485
      Directors retirement benefits                        300000          300000
                                                          4213203         5943485

Liabilities Against Assets Subject to Finance Lease        464912          855608

Current liabilities
       Current maturity show under current liabilities     413522         787763
       Short term running finance s                      22033275       24930625
       Short term loan secured                            4452404        3837055
       Creditors accrued and other expenses              41077580       43869635
       Unclaimed dividend                                  102434         105690
                                                         68079215       73530768
Contingencies and commitments                            97161466      120269354



                                                   59          Buxly Paints Ltd.
An Internship Report



Income statement of last two years

Income Statement Description

Description                                 1999           2000
Sales                                       141309229       186188376
Cost of sales                               122098219       153294307
Gross profit                                 19211010         3289069
Administration Expenses                      20053925        21871214
Selling expenses                              8777257        13107352
                                             28831182        34978566

Operating loss                               -9620172         -2084497

Other income                                  2685953          544394
Claim for refung of excise duty                               3428095



Financial charges                             5391612          6640241
Loss before Taxation                        -12325831         -4752249

Taxation
   Current                                     706546          930942
   Prior years                                 500000

                                              1206546          930942

Loss after Taxation                         -13532377         -5683191



Inappropriate profit brought forward         -5614400            68791
Inappropriate loss carried forward          -19146777          -561400

Basic earning per share                            -9.4           -3.95




                                       60             Buxly Paints Ltd.
An Internship Report



SWOT Analysis
In this analysis the whole organization is being squeezed in to few words
which can help it to survive in this competent world.
Strengths
Strengths are those things that by availing them we can capitalize and have
a result in the form of profitability. The strengths the Buxly have are
    The age old name of the organization
    The quality products
    The bigger govt.contarators
    Having ISO &U.K.R.S advantage
    Satisfied old generation as the first manufacturer in subcontinent
Weakness
       The conflicting union problem
       Misuse of organizational resources and mismanagement.
       No technical team
       No promotional activities
       Low market share
       Low and waiting production processes
       No forecasting for the raw material as per demand.
Threats
     The new emerging companies are prevailing the opportunities from
      those areas where Buxly has loose control e.g local customers, human
      resource.
     The competitors are using the better promotion skills, which help
      them to defend against Buxly.
     Huge job burden on the employees is demotivating them and they just
      maintain their existence in the factory.
Opportunities
        Buxly has the vast range of opportunities to restructure itself as a
        competitive firm given as
             To use their technology of paint research and develop new
               high-class paints used in local industries.
             To have the good management in the organization having
               good benefits and rewards.
             They have a greater opportunity to expand its products whole
               over the country because the organized sector is producing
               only 20% of paint and remaining is being prepared by
               mushroom sector.



                                        61                Buxly Paints Ltd.
An Internship Report


            Buxly have the past experience of exporting paints to middle
              east and far east countries, so by improving the quality and
              standard they can again capture the market of these countries
              again.
            They have a wider opportunity to use the distribution of the
              Berger Paints which can reduce their cost as well.
            By using the facilities of Berger they can cash themselves due
              to their goodwill in the market.
            Buxly should come in the auto paints market due to their past
              experience and R&D skill.
These are the strengths, weakness, opportunities & threats, which are key to
access the compatibility of the business. The main purpose is that the
company should capitalize the strength by availing the opportunities and
avoiding the threats by overcoming the weaknesses.




                                       62                Buxly Paints Ltd.
An Internship Report



                       Suggestions & Recommendations


   There are some suggestions and recommendations for each department of
the Buxly. As I observe different departments as per the schedule of the
Buxly I try to find out the problems and their optimum solutions. I will start
from order taking and move towards the final receiving of amounts.

NEW ORDERS:
If the order of new product is receive from customer, first its sample is to be
produced in the laboratory then it passes to the costing department for its
costing. After the costing and approval of rates its order should place and
sent to computer department.
       PROCEDURE TO FOLLOW BY THE SALES DEPARTMENT
          AGAINST INDUSTRIAL AND DECORATIVE ORDERS


     The format of Production order should change because of incomplete
      information.
     All the order should furnished by the sales department with proper
      product name, product code, pack-size, quantity of Tins, quantity in
      liters/kg, price, delivery date and, mention the (L/D) if imposed by the
      customer.
     Proper customer name and customer code should be mention on the
      production Orders by the sales department.
     Sales officers should first confirm the product and shade by the
      customer before sending the orders.
     Awareness of the product information in Sales Officers (Karachi,
      Lahore & Pindi/Islamabad) is must. They should know what is the
      customer requirement and what product they going to deliver.
     Observed orders of High Build paints(base) component-A and their
      Hardener component-B in which color is mentioned in both the
      products, where as in case of (base) component-A, color is present but
      in the Hardener component-B there is no color.
     All the production orders must have a receiving data noted on top (a
      rubber stamp to be use for this purpose) by the concerned
      departments, i.e. (Sales, Building department and Production), to have
      a record, on which date they receive the orders.


                                         63                Buxly Paints Ltd.
An Internship Report


     Sales department should prepare a list in which they mention which
      products are industrial and which products is decorative including
      their pack size. The same list should also give to the other Regional
      Heads for their information.
     Production Order of Decorative Products and Industrial Products
      should prepare separately.
     Production Order receives from different regions should mention their
      region or city first then their Order Number on the Production Order.

FOR EXAMPLE

     If the order of Decorative product is receives from Lahore it is noted
       as (LHD-01), (LHD-02) like wise.
If the Order of General Industry is receives from Lahore is noted as (LGI-
01), (LGI-02) like wise.


        PROBLEMS OBSERVED REGARDING PRODUCTION



                             PRODUCTION

     Observe the general practice of production of batches without
      generating the batch papers.
     Manual batch papers are being used for the production.
     Batches are produced directly by the production department before
      any entry in the computer‟s factory system.
     Production department sent the manual batch papers after the
      completion of the batch (Already fills in the tins) to the computer
      department for generating the batch paper.
     No Bill of material is generating against the orders for the requirement
      of the raw material.
     The laboratory or the production to generate the batch paper does not
      provide proper product code/shade code.
     Clayton Gel is uses as an intermediate in the batches is mostly
      produced first and its batch paper is generated latter.
     No production order and their list with proper order no, lab references
      and product code is available to the Production Department.



                                        64                 Buxly Paints Ltd.
An Internship Report


     Production department daily produces the batches but they did not
      give any information of the production, the same day. Next day or
      after that they give manual papers for the same.
     Duplication of product codes and product shades are found in the
      system. Some Products which are same, having different product
      codes.
     Daily filling and monthly filling in (Liters & Kg) is not mention on
      the filling/packing report.
     No order no and batch number from batch paper is mention in the
      packing/filling report.


      PROCEDURE SHOULD FOLLOW BY THE PRODUCTION
                     DEPARTMENT

     Batch paper is the first and necessary thing, which to be generating
      before the production.
     No batch should produce without batch paper.
     An “Internal Requisition Slip” should give from Production
      department to the raw material store for the additions of the raw
      material.
     If extra raw material is needed in the batch it must properly noted in
      the batch paper by production department or the laboratory, therefore
      the quantity of raw material used can easily be check.
     Weekly production plan should make to know which product is going
      to change on the machine.
     A “Daily Charging Report” should prepare daily in which running
      status of charged product in the machines/pots/tanks should mention.
     Production department to give the details of the machine and their
      charging size.
     Machine numbers to be assign to all the machines.
     Production department should give the batch papers with the “Daily
      Production Plan Sheet” to the raw material stores.
     Production department should give the “Daily Batch Request Sheet”
      to the computer department to generate the batch paper.
     Bill of material should generate monthly to know how much quantity
      and what kind of raw material are needed to produce the orders in the
      current month.




                                       65                Buxly Paints Ltd.
An Internship Report


     Weekly bill of material should also generate to which raw materials
      are required to produce the products in the first week of the month.
      Similarly for the 2nd, 3rd and 4th week.
     Proper raw material name or code and quantity should mention by the
      production on the batch paper in case of additions.
     Similarly if there is deletion in the quantity of the raw material it
      should also mention by the production on the batch paper.

If production is uses an alternative raw material due to the storage of the
original raw material, it should first confirm with the laboratory then on a
written format with properly signed by the head of production and laboratory
give to the computer department to change the following in the formulation.
Similarly the same procedure will follow in changing the raw material
quantities/percentages (%) in the formulation also.

           RECOMMENDATION OF PROCEDURE TO FOLLOW
              BY SALES, DISTRIBUTION, LABORATORY,
          PRODUCTION AND (MIS) COMPUTER DEPARTMENT

      A five member committee is to be formed in which one
       representative each from Sales, Production, Laboratory, Distribution
       and Computer should meet for 15 to 20 minutes every day in which
       daily order received by the sales should discuss.
      Person from sales should provide correct Product Information
       including Product name, Product code, Shade code, pack size, total
       quantity, price etc on the production order.
      Person from laboratory should responsible to check the product in
       the order and provide the correct Lab Reference for the same.
      Person from production should responsible to check the batch size of
       the product and raw material availability to produce with in the
       delivery time.
      Person from distribution should responsible to check the price and
       stock if available against the same order.
      Person from computer should check the product code, product shade
       and pack size of the order in the case of new product.
      Each Customer Orders should receive by Sales Department.
      Sales Department should differentiate between H.O. (Stock Line
       Products & Pack Size) and P.O. (Non Stock Line Product & Pack
       Size).



                                       66                Buxly Paints Ltd.
An Internship Report


      Any inquiry about the Product information should send to the
       Technical/Laboratory.
        1. To Technical Department for verification of Product and their
           lab reference.
        2. To MIS Department for opening of Product Code, Shade Code
           and Lab Reference.
        3. To costing Department (in case of new products) for
           Product/Batch Costing.
        4. To Billing/Distribution Department for post line of production
           orders in the system.


    MIS
             Same product code and shade code should open in the factory
              system and branch system.
             Person who opens the product codes in the Factory system
              should also responsible to open the [product code in Branch
              system.
             Proper user login and passwords to be provided to the users..
             Changes in the raw material rates should give to computer
              department time to time by the concerned department to update
              the system. This enables us to get accurate costing of the
              products required.
             Duplicate product codes which open time to time by different
              persons should be deleted from the system


    LABORATORY:-
    1- Laboratory should provide the formulations before the time of
    production.
    2- Many formulations are providing to the computer department after the
    product finishes and packed by the production.
    3-Laboratory should assign the Bases for PBD, EMULSION, and
    WEATHER FIGHTER, in “Whites & Soft Whites”, “Off White”, “Tint
    Base”, “Mid Tones” and “Deep Tones”.
    4- For Off White shade there is separate Lab Reference.




                                        67               Buxly Paints Ltd.
An Internship Report


   5- Laboratory should give a separate Lab reference to “White % Soft
       Shade” and all the shades, which come in this category, should have
       the same lab reference.
   6- Laboratory should give a separate Lab reference to “Tint Base” and
       all the shades, which come in this category, should have the same lab
       reference.
   7- Laboratory should give a separate Lab reference to “Mid Tones” and
       all the shades, which come in this category, should have the same lab
       reference.
   8- Laboratory should give a separate Lab reference to “Deep Tones” and
       all the shades, which come in this category, should have the same lab
       reference.
   9- Laboratory should responsible to check all the production orders and
       give the related lab references to the products mention in them.
   10- new formulation to be provided by the laboratory before producing
   the batch.
   11- Laboratory should responsible to identify the type of New Product
   whether it is:-
                 1. Air-drying/Stoving
                 2. Matt Finish/Glossy.
                 3. Enamels/Hi-Build Epoxy/Hard Gloss/Brush Finish etc
12- Laboratory should responsible to check the new raw material and give
the complete name and code to MIS (Computer Department) to input in the
system. (Sample format of new raw material input attach)
13- Technical/laboratory should responsible to produce a sample batch of
the new product given by the Sales Department in the laboratory.
14- If a new Product/Product shade is required laboratory should responsible
to give the complete information including lab reference, Formulation,
Product type, Name of product and the name of the Shade to (MIS)
Computer Department to input in the system.(Sample Request Form is attach
for this purpose).




                                       68                Buxly Paints Ltd.
An Internship Report



FINAL WORDS
At the end I would like to mention the overall behavior of the employees of
Buxly for the evaluation purpose. All the people in the factory require a
power full motivation and reinforcement for the progress, the whole
employees are dissatisfied rather than unsatisfied. They require recognition
as well as some incentives and addition in their wages because in this tense
environment having ever-changing phenomenon               the company should
support it‟s higher as well as lower level staff in terms of monitory as well as
recognition.
As for the behavior of the factory employee is concern they all cooperate
with me except those persons for them I was threat to change their attitudes
towards work and they were mostly included in the production department
and to some extent in the accounts. Except few bad experiences all the
people at Buxly from their MD, specially the executive director, all
departmental heads, workers help and encourage me in each and every step
to learn the process of the organization.
In the end I am most thankful to the factory manager Mr.Niazi who help me
a lot in learning the process and provide his guidance at each and every step
during my stay at Buxly. I hope a prosperous and bright future to Buxly as
being the business partner of the Berger paints Pakistan limited.




                                         69                 Buxly Paints Ltd.

				
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